A Chapter 11 bankruptcy case is often referred to as a business reorganization case. In a Chapter 11 case similar to a Chapter 13, the business debtor proposes a plan of reorganization to the Bankruptcy Court to restructure its finances. A Chapter 11 plan typically proposes to reduce secured debts obligations by modifying payment terms to pay the reduced loan balance over time with interest. Unsecured creditors are often paid some amount over the life of the plan. A business debtor also can sell some or all of its assets so it can downsize its business if necessary or pay down claims owed. The purpose of a Chapter 11 plan is to help a business debtor restructure its business by balancing its income and expenses, regaining profitability, and continue in operation of the business.
If you are a business owner and require professional legal services regarding a Chapter 11 reorganization bankruptcy, be proactive in protecting your legal rights contact The Washington Law Firm today at 407-982-4130.